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When you read 'oil', think 'US sub-prime'

One of the many lessons we should have learnt from the 2008 crisis was that it can be really hard to predict how the financial system will react to a shock.

When you read 'oil', think 'US sub-prime'
Photo: Getty Images

One of the many lessons we should have learnt from the 2008 crisis was that it can be really hard to predict how the financial system will react to a shock.

Did you have any idea what impact a fall in US house prices could have? No, neither did I. Yet when the oil price tumbled in 2014, most observers had few doubts, confidently asserting that it would be good news for the financial system.

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